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Why a $5 Debit Card Fee Is a Good Thing

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Bank of America’s $5 debit card fee might not be such a bad thing.

For the past couple of days I have watched in disbelief how everyone has piled onto Bank of America for announcing a $5 monthly fee for debit cards.

People are swamping the bank with hate. Outraged customers jammed its website.

The president of the United States denounced the move, which he said was exactly the kind of thing the new consumer watchdog is supposed to prevent – and denied banks have “an inherent right to get a certain amount of profit, if your customers are being mistreated.” On Tuesday, Treasury Secretary Tim Geithner and others piled on too.

“Get the heck of out of that bank,” thundered Senator Dick Durbin from the floor of the Senate on Monday afternoon. “Bank of America customers, vote with your feet.”

What a farce. If Bank of America customers don’t like paying a $5 a month for a Bank of America debit card, they have three options:

1.  Move to another bank. There are thousands in America. I bank at a non-profit credit union. That way I know my banker has no incentive to try to scam me. They have no fat cat executive to support. They have no big marketing boondoggle to underwrite.

2.  Junking your debit card, use cash instead. It’s that green paper stuff you may have seen from time to time, picture of a dead president on one side. Go into your bank or credit union and cash a check, and they will give you a bunch of it. You can go out and spend it. Merchants pretty much take it everywhere.

3. Get hysterical. Go ahead, burst into tears, scream, wail, inundate the bank with hate mail, picket your local branch, and wait for the president of the United States and a senator from Illinois to come rushing to your aid, brandishing salve and Band Aids.

It takes a lot to bring me out in support of the “banksters,” but this is absolutely moronic.

Companies charge for their products and services – last time I looked, anyway. I go to a restaurant, I get a bill. I go to a store, I buy something, I pay the cashier. Why should banks be any different?

Yes, Wall Street bankers have behaved outrageously in recent years. The most appalling sight recently has been that of overpaid CEOs at the Wall Street banks using their bailout money to, er, lobby Congress against reform.

But many of the worst offenders – the people who caused the financial crisis – have actually left. They’ve retired with their loot. Blaming the “corporations” and their stockholders – who have lost most of their money – is at this point misdirected.

Anyway, none of that has anything to do with debit card fees. The real problem with the banks in the past has been all the hidden fees they’ve used to nickel and dime you. The “mouseprint” (tiny disclosures) and “gotcha” terms and conditions. The “0% financing” that suddenly turns into 30% financing – backdated to the start – if you are late by 10 seconds with one payment. The way they have played game theory against their customers, trying to trick them. The usury.

That’s the stuff that the Dodd-Frank reforms, including the Durbin amendment, sought to curtail. And it’s working. The banks are now making more of their fees visible.

This $5 monthly charge from Bank of America, far from being a source of outrage, is actually a good thing.

That’s right: A good thing. They’re telling you up front, in plain English, how much a service (a debit card) is going to cost you.

You have the information you need to make an informed choice. Maybe you think the convenience is worth $5 a month. Maybe you think it isn’t. But it’s all there in plain sight.

If you don’t like it, move to another bank. You don’t need Dick Durbin’s advice.

As it is, Bank of America stock is in freefall. This year it has collapsed by more than half. Its bonds are trading as if default – bankruptcy – is a serious possibility. So it is absurd to attack them for “gouging” or “profiteering” or whatever other term we are using these days to describe a profit being made by someone other than ourselves. (When we make a profit, of course, it is just a reasonable rate of return.)

It is also worth noting that a glance through Dick Durbin’s personal financial disclosure shows he holds investments in Warren Buffett’s Berkshire Hathaway (BRK.B) and the Fairholme (FAIRX) mutual fund. Both are investors in Bank of America, and other bank stocks. In other words, those “profiteering” from the customers of Bank of America, and other banks, include plenty of shareholders, Sen. Durbin among them.

Brett Arends’ column appears in SmartMoney Magazine and also three times a week on MarketWatch.com

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    • By WebOsPublisher

      Tech Priest Miniatures
      TECH PRIESTS
      ADEPTUS MECHANICUS FANS: BE SURE TO CHECK OUT THE WARHOUND
      AND THE RENEGADE TECH PRIEST!
      Click on the links below to see a front and back view of my Tech Rhino
      conversion. Use the Back button to return to this page after viewing.
      TECH RHINO
      BACK VIEW
      ABOUT THE TECH RHINO: I made the back end square by building
      it up with some sheet plastic. In place of the normal top doors,
      I added a crane made from model parts, tank wheels, and picture frame hanging
      wire. I installed a tool crate and a 55 gallon drum on the back,
      both from 1/35 scale tank kits. In place of the top hatches, I added
      the Scanner base from the Whirlwind kit, and instead of a scanner, I made
      a pintle mount for a storm bolter. The ram plow and smoke launchers
      are right off the vehicle accessory sprue. The spotlight is
      made of the front plate from the accessory spotlight, with a Lemann Russ
      tank wheel on the back. The whole spotlight assembly is mounted on
      the pivot mount for the Hunter Killer missile. I added Lemann Russ
      track over the original tracks to bulk them up (as well as spare track
      up top). The Vindicator style cannon on the front is an old Armorcast
      conversion kit (now out of print). The tools are off of the old Battlewagon
      kit (also out of print, sadly). I painted the whole thing up in dark
      grey and dark red just like my tech priest miniatures.
      Ever since I saw Jes Goodwin’s drawing of two Tech Priests
      brooding in the shadows, I wanted to make an Adeptus Mechanicus army. Traditionally,
      Tech Priests wear robes and hoods, and are covered with a multitude of
      technical add-ons. To capture this look, I started with a Mutant Chronicles
      miniature. I added the servo arms on the back (from Fabius Bile), replaced
      the left arm with a Servitor arm, and added a power wrench to the right
      arm (made of a Space Wolf servo arm and bits from a plastic Skaven). The
      hoses are fine springs that I plugged into holes drilled in the model.
      This is another Mutant Chronicles miniature with similar modifications.
      I added an Inferno pistol (from Dante) and a power axe from the new Techmarine
      model that comes in the command squad box set. To make the model look more
      appropriate, I filed off an icon on the front and replaced it with a Titan
      Legions decal. Chains and other technical bits complete the conversion.
      I paint the robes with a dark red, washed with black. I detail the rest
      of the models with dark grey and yellow.
      This is a converted Chronopia miniature (a Judge). I removed the odd
      spikes from the shoulders, filed them smooth, and added a decal there instead.
      More tubes were added, as well as a backpack from a Necromundan heavy.
      The right arm has been completely replaced by an assault cannon (actually
      a vulcan gun from a Warlord Titan model). Although the gun is excessive,
      the bulk of the model almost makes it look sensible.
      Tech marine models make great Engineers in a Mechanicus army. To make
      them blend in, I avoid putting chapter symbols on my Techmarines, and often
      arm them with more unusual weaponry. I replaced the servo arm on this Space
      Wolf iron priest with a buzzsaw arm from a pit slave, giving the model
      an even more feral look. The model was painted dark grey, washed with black,
      and drybrushed with medium grey to make all the detail pop out. The dark
      red trim helps it blend in with my other Mechanicus models.
      This is a fairly standard Techmarine model, although I added a combiweapon
      (from Azrael). This model has also painted up well in my Mechanicus colors.
      Although they are a nuisance to paint, wire bundles really look good if
      they are each a different color. A black wash helps make them stand out.
      Don’t forget to paint your skulls half black- this is a classic image for
      the Adeptus Mechancius, representing the half-machine skull. Although I
      normally paint weapons grey or black, the dark red seems to work well on
      these models.
      Yes, that’s Terminator armor! I originally did this conversion for
      a Space Marine army, but it also doubles as my Tech Priest Magos (army
      leader). The body is a Chaos terminator. I added Thunder Hammer and Storm
      Shield arms from an Imperial Terminator, replacing the Storm Shield with
      a plasma pistol. The Servo arm is off a Servitor model, and fits nicely
      in the slot where the Chaos spikes used to go. Adding an Imperial eagle
      and other crisp details makes it clear this is no chaos marine…
      High mobility characters are very popular in our Marine campaign, thus
      this Techmarine conversion.. Currently employed by the Raven
      Guard, this Techmarine comes complete with power claw (one of the new
      ork Bionic bitz), since jump pack and melee are a good combo, and
      servo arm for field repairs (stolen from a hapless servitor).
      The legs are plastic Berzerker legs, as they looked more technical than
      stock marine legs. Finally, a Techmarine that can keep up with those
      Landspeeders that always seem to get into trouble behind enemy lines…
      You can clearly see the servo arm in this back view (along with the
      extra grenades and pouches on the waist. I tend to add gear there
      for jump pack models, to counteract the “wasp waist” look the jump packs
      tend to cause (although the power axe and claw are pretty bulky already!).
      This model is painted using the same colors as the other Mechanicus models.
      I like the way the jump pack breaks up with these colors, especially the
      mix of steel and brass jet nozzles.
      I made this plain techmarine model more formidable by converting
      a 2 handed axe for him! I sawed the head and pommel off the
      new techmarine axe and pinned them to a section of a metal fantasy regiment
      banner pole arm. To bulk up the pole, I wrapped copper wire around
      it. then I pinned the whole thing to a plastic arm, which I added
      some tubing so I could stat it as a bionic arm (painting it steel and brass
      helped too).
      My Tech Marine on Bike. I converted a marine bike by adding
      the gear icon (from a Chronopia black sister) and grenade launchers (from
      the attack bike) where the bolters used to go, and added a gear-laden pack
      (from a Necromunda Heavy) to the back of the bike. The marine rider is
      suprisingly stock- aside from adding an Inferno Gun hand in place of the
      bolt pistol, this is essentially the new Techmarine from the command squad.
      With just a bit of filing on the legs, he fits just fine on a bike (as
      long as you don’t mind the “No hands” riding style). I didn’t even glue
      him on, so he is removeable to represent dismounting (useful for climbing
      ladders, etc). I painted the bike using the same colors I’ve established
      on my other tech models. With the servo arm, bionic arm, Inferno gun,
      and power axe, this mounted model makes a formidable opponent in melee!
      BEWARE: THE FALSE PROPHET OF
      THE OMNISSIAH AWAITS
      Back to Miniatures Page
      Back to Necromundicon

    • I was just looking for this inrmaoftion for some time. After 6 hours of continuous Googleing, finally I got it in your site. I wonder what is the Google’s problem that does not rank this type of informative websites closer to the top. Generally the top sites are full of garbage.

    • The citizens issue is true…its just depends on which type of bank account you have with them. I had what I thought was a really great student checking account with them. It is now 5 years later and they are charging me al sorts of fees I have not seen before. I am done with them and am moving my money to a credit union.

    • Why did you bother writing this????

    • “Its only 5 dollars a month. Citizens bank charges 15 a month if you don’t have 1500 in your accout. Ill take the 5 dollars anyday”

      No, they don’t. I have 20 dollars in my account at the moment and it rarely goes over 500. I do not get charged 15 dollars from citizens bank EVER.

About Pay Dirt

  • Pay Dirt examines the millions of consumer decisions Americans make every day: What to buy, how much to pay, whether to rave or complain. Lead written by Quentin Fottrell, the blog examines these interactions, providing readers with news, insight and tips on shopping, spending, customer service, and companies that do right – and wrong – by their customers. Send items, questions and comments to quentin.fottrell@dowjones.com or tweet @SMPayDirt.

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